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T-Mobile gets aggressive.

First in a series looking back on some of the turnaround stories of 2012

What a difference a year makes. Fifty-one weeks ago, AT&T announced that it was abandoning its $39 billion plan to buy T-Mobile USA due to regulatory concerns that it would lead to too much concentration of the U.S. mobile phone business. Despite walking away with a $4 billion breakup fee from AT&T, T-Mobile parent Deutsche Telekom seemed to be at a loss for what to do next. It had been trying to fix what was broken at T-Mobile, the #4 carrier in the U.S., for years and when the big merger fell apart the future was uncertain. Then came 2012, the year the world was supposed to end according to the Mayans, but for T-Mobile it's been more like a scene out of "Its a Wonderful Life." In October, the company made a deal to buy MetroPCS, the most desirable target left on the mobile chessboard. Then just last week, the company announced it would finally be getting Apple's iPhone (in 2013) and also announced a revolutionary plan to get rid of phone subsidies. For the often slow-moving mobile business, these past three months have been nothing short of remarkable.

The Ghosts of Christmas Past

It's hard to believe that not only did all of this nearly not happen, but a lot of smart people and smart money did everything they could to stop it from happening. Much of the technology industry, you see, threw its weight behind the AT&T/T-Mobile merger. They did this because ostensibly without it, AT&T wouldn't be able to provide sufficient 4G data services, innovation would slow and it would set back all sorts of amazing things. Microsoft, Facebook and a number of prominent venture capital firms even filed letters with the FCC supporting the merger.

Of course, all of this seems remarkably bizarre in retrospect. Since then, Facebook has gone public and more than half of its billion users access the site from mobile devices. On top of that, it bought Instagram -- perhaps the fastest-growing mobile service ever -- for nearly a billion dollars, right before the IPO. Mobile data use and the "app economy" (which is estimated to employ about 500,000) are exploding. So let's again remember people were actually advocating it was practically necessary to have fewer mobile service providers rather than more. In reality, the two companies would still be integrating their networks and billing systems today and, of course, no spectrum would actually have been created by the merger.

Instead, AT&T, which kept claiming it couldn't compete with Verizon's 4G due to a lack of available airwaves, now says it has the largest 4G network in the country. While the claim may be inflated, the reality is that the regulators told AT&T to go out there and compete instead of trying to buy out the competition. And the results have spoken for themselves. Maybe Mitt Romney got it right at the first presidential debate when he said: "Regulation is essential. You can't have a free market work if you don't have regulation." Whatever the case, mobile innovation in the U.S. is alive and very well.